Category Archives: Industry 4.0

India – this is what could derail your Industry 4.0 initiatives

Category : Industry 4.0

Globally, the manufacturing industry is witnessing a shift towards Industry 4.0, a concept that employs multiple digital technologies to enhance and improve the complex touchpoints of this industry. Industry 4.0 also has come to the forefront as we become a consumer-centric economy where improving customer experience trumps cost cutting to accelerate business growth.

India, too, cannot remain alien to this revolutionary concept. Presently the manufacturing sector contributes 17% of the GDP. With impetus from the government to increase this number to 25% to push economic growth, manufacturing companies are being compelled to look at technologies such as automation, big data analytics, cloud computing, robotics and sensors and AI to boost the manufacturing process.  As Industry 4.0 establishes itself as an industry best practice, manufacturing companies have to look at strategies to bind the digital and manufacturing worlds. While the transition to Industry 4.0 will need a significant “economic and social transformation and political and institutional framework”, organizations adopting this standard have to be wise while embarking on this journey and ensure that they escape the traps of narrow vision.

In this context, what are these potential minefields that can derail India’s Industry 4.0 initiatives? Being one of the sixth-largest manufacturing nation and the biggest recipient of foreign direct investments (FDIs), Indian manufacturing companies have to ensure that they don’t make these epic mistakes.

Poor strategic business direction

“If you don’t know where you are going, any road will take you there”….or maybe not. In the case of Industry 4.0, organizations need to have a definitive digital strategy that is aligned with business goals and initiatives. These strategies have to be focused on maximum ‘value’ generation. This value generation can range from increasing product efficiency to increasing sales growth. Creating a clear business opportunities roadmap which accounts for productivity, product resilience and performance, sales growth, internal processes, product innovation, customer focus and consequent sales growth become essential. Not taking such an approach leads to haphazard and confusing implementations that impede, rather than improve, efficiencies.

Focus on technology alone

Yes, Industry 4.0 is the ground where technology meets manufacturing. But Industry 4.0 is not about the technology alone. It is about all the touchpoints that impact the production process and then some. Going gung-ho and making technology decisions without understanding how these choices will change processes, not having a plan on how to manage that change, evaluating the downtime, infrastructure needs and the costs associated with that can severely hamper the initiatives. The shift to Industry 4.0 has to be organic and must evaluate which processes need to be changed first and why.

If organizations just get excited about the technology, do not make quantitative estimates, do not set up a business case that takes into consideration complete costs from acquisition to operations and do not measure the impact of the change, these initiatives will most likely fail. Industry 4.0 cannot be approached from a technological perspective alone while pushing its impact on the business to the background.

Lack of a skilled workforce

The Economist’s Intelligence Unit survey cited skill issues to be one of the major barriers to the adoption of Industry 4.0 across the globe. “More than a third of survey respondents acknowledge that they are struggling with recruiting and retaining talent.” The survey also states that 42% of the respondents “worry that over the next three years they will not be able to recruit new workers with the necessary prerequisites for on-the-job training.”

The National Skill Development Corporation (NSDC), a public-private partnership set up by the Planning Commission estimated the rising skills gap to be more than 250 million workers across various sectors by 2022. An article in the Wall Street Journal shows that while India does not have the labor shortage, it has a shortage of skilled labor. Despite having numerous engineering and vocational schools, “The quality of the manpower when they come out of engineering colleges is not A-grade,” according to Bharat Salhotra, managing director for Alstom India & South Asia.

These numbers are not consoling as the level of technical dexterity needed in the Industry 4.0 era will increase incrementally. Identifying right training and upskilling opportunities will be contributors to Industry 4.0 success. If India wants to become a manufacturing hub, then along with government initiatives such as Skill India, manufacturing companies have to themselves take the initiative to identify where the skill gaps in their workforce lie and take measurable steps to resolve that with the right learning and development initiatives. Unless this happens, implementing Industry 4.0 in India will not bring in the promised benefits.

Industry 4.0, while being a superlative concept, can seem like a complex web woven by technology. The manufacturing industry, especially the Indian manufacturing companies, have been accustomed to certain manual processes and methods of operation. The shift to Industry 4.0 signals a change in times and change is never easy to accommodate and can often be a hard challenge to mitigate. While adopting any new revolutionary concept has some teething problems, it is essential to ensure that the concept does not become that white elephant – one that is hard to obtain and maintain.

How manufacturing companies can prepare their entire workforce for Industry 4.0

Automation, IoT, Machine Learning, advanced analytics, cognitive technologies and others are geared to create an enterprise that is more interconnected and data-driven. The end objective is to enable better decision-making and improve business outcomes. The impact of these technologies is felt in all industries, and manufacturing is no different. The rapid adoption of technology has paved the way for disruptive development in this sector and has brought to us the Fourth Industrial Revolution, commonly known as Industry 4.0 that brings with it the promise of changing the manufacturing industry as we know it.

Industry 4.0 – a primer

Industry 4.0 employs the use of technologies such as Big Data, Industrial Internet of Things, Artificial Intelligence and others to get solutions to complex problems and make the assembly line more efficient. According to a PWC report called ‘Industry 4.0: Building the Digital Enterprise’, we are already in the front and center of this revolution with over 72% manufacturing companies using data analytics to improve customer intelligence and customer service. 35% of companies adopting Industry 4.0 expect 20% higher returns over the next five years, and 86% of manufacturers expect lower costs and higher revenues.

Countries such as Germany and Japan have been the pioneers of Industry 4.0 and have shown that its adoption has improved their business outcomes. It won’t be an exaggeration to say that Industry 4.0 has brought about a paradigm shift in manufacturing by replacing rigid value chains and transforming them into highly flexible networks.

Why is manufacturing moving towards Industry 4.0?

Since Industry 4.0 is built on the concept of end-to-end visibility, efficiency, and agility across every touch point in the value chain, it gives manufacturers the capability to assess how they can reduce overhead costs while remaining flexible to respond to unforeseen changes in production programs.

Industry 4.0 is more than just production. It is all about how smart and connected technologies can change the way products are designed, built, used and maintained. Apart from transforming the production cycle, Industry 4.0 also transforms the organization itself by presenting new ways to consume and interpret information and achieve operational excellence by improving decision making. Deutsche Bank Research, in their report the ‘New Industrial Revolution’ states that the smart manufacturing initiatives show a productivity jump of almost 30%.

Clearly, Industry 4.0 is not just about the shop floor but about the entire organization and how technology can be used to harness growth. We are seeing increased use of sensors and wearables, machine learning, advanced computer numerical control, and robotics to enable product improvements, and rapid prototyping to consequently enable innovation in new offerings. The impact of Industry 4.0 can be felt across the organization operates but how its ecosystem of customers, regulatory compliance, third-party experts, suppliers, etc. function and interact. It focuses on improvements that lead to enhancements to productivity, better risk reduction, incremental revenue growth, and generating new revenue sources.

Industry 4.0 also signals a shift in workforce dynamics and training needs

At the same time, Industry 4.0 means a significant shift in the manner in which employees in manufacturing work today and how they are expected to do so. The rise of automation and connected systems also signals workforce transformation. And this is where the manufacturers’ dilemma begins. Manufacturers not only have to lure tech-savvy talent but also have to reskill or upskill existing resources to harness the power of the new disruptive manufacturing technologies. A highly technologically advanced environment means more employee contributions revolving around technology, digital and intelligence roles. The isolated, optimized units need to together as completely integrated automated units with optimized production flows. These developments change the traditional production relationships.

Given the complete change in the manufacturing ecosystem, it becomes imperative to prepare the workforce and conduct strategic workforce planning.

  • For this, manufacturing companies have to look at hiring skilled resources for new job roles, adapting existing roles to the new methodologies, and upgrading IT skill of all resources.
  • Industry 4.0 also means a greater focus on compliance, regulatory and security aspects and demands all invested to be thoroughly updated on all new developments in these areas.
  • Since Industry 4.0 is a paradigm shift in itself, manufacturers have to ensure that all resources are suitably skilled to handle their new roles and responsibilities and are capable of managing the change in work patterns and in processes.

Training and development, thus, becomes a key area to concentrate on to enable this workforce evolution.

In the age of Industry 4.0, manufacturers need to prepare their entire workforce to harness the power of technology. This means frequent training and updated learning and development initiatives that address the pain points and learning gaps of the existing workforce. It also means accelerated onboarding and skill upgrades for the new hires to make them multi-skilled as with Industry 4.0.

The way ahead

In order to be prepared for this revolution, manufacturers have to ensure that all their resources are up to step to face the new order. Learning and development initiatives have to be more inclusive and take into consideration the varying needs of the resources. To achieve great training outcomes and to ensure that training costs are controlled, manufacturing companies need a new age training program…one that is complementary to the new age manufacturing unit.

Given the large resource pool that needs training, the diverse training needs of the workers, a large and often distributed workforce, manufacturing industries need a new training model that can proactively improve resource knowledge base. Training programs have to be more scalable, personalized, and flexible to adjust to the dynamic needs of Industry 4.0.

Taking a Blended Learning approach that combines classroom learning with eLearning emerges as a recipe for training success. With this approach, all awareness and knowledge sessions can be conducted leveraging eLearning while classroom training can be used for skill and expertise development.

Blended Learning takes the pain out of existing learning and development initiatives and gives manufacturing companies access to a huge knowledge repository, a talented resource pool of industry experts who can aid training, the flexibility to scale training programs in short time frame, and the ability to disseminate content in easily retainable bite-sized chunks in a device agnostic manner.

It is now clear that Industry 4.0 is going to be the silver bullet that helps manufacturers stay ahead of the curve in an increasingly competitive and complex market. However, in order to deliver on its promise, manufacturers have to make sure that they arm their workforce with the right tools to do their jobs better. And in this case, there is no tool that is greater than knowledge.